TORONTO -- The Ontario government said on Wednesday it will spend C$625 million ($419 million) over the next five years on training and development programs designed to attract automotive plants to the province, already home to much of Canada's auto industry.
Ontario Premier Ernie Eves called on the federal government to match the province's funding commitment to help keep automakers from moving investment and jobs to the United States, where several state governments are offering large incentives to try to get auto industry investment.
Eves said the program will concentrate on "large-scale investments that create quality jobs and support innovation, research and development."
"We are calling on the federal government to step up and match our commitment," Eves said during an announcement made on the floor of a General Motors assembly plant in Oshawa, just east of Toronto.
"Our government is working hard to protect and create jobs in the province. I think it is important that the federal government work equally as hard as partners to create jobs and protect jobs throughout Canada."
Automakers have said the Ontario and Canadian governments must come up with assistance if the companies are to make large-scale investments in the province.
Ontario, once a leader in automotive investment, has been losing out over the past decade to locations further south, which are more willing to offer cash incentives and tax breaks to attract investment.
Of 17 new North American auto plants built since 1990, just one was in Canada. Seven were built in the U.S. deep south, and six in Mexico. The rest were elsewhere in the United States.
A key test for Ontario will come later this year when DaimlerChrysler finalizes plans for a new assembly plant, tentatively set for Windsor, Ontario. DaimlerChrysler conditionally promised the plant for Windsor in last year's contract agreement with the Canadian Auto Workers.
But it said it would build the plant only if it could secure a major financial commitment from government. Though the company has refused to say how much money it would need, C$300 million has been suggested in the media.
"We're cautiously excited. The government is signaling that it now understands what it has to do," said Jim Stanford, the Canadian Auto Workers union's economist.
"The first litmus test will be that DaimlerChrysler one. And once we see (the government) doing it then we'll have real reason to celebrate."
DaimlerChrysler itself hailed Eves' announcement as a step in the right direction.
"We're very encouraged... It's the government of Ontario acknowledging the importance of the auto sector to the economy of Ontario and Canada," said Kerrey Kerr, a spokeswoman at DaimlerChrysler Canada.
"Our discussions certainly continue on the potential new facility for Windsor and we're looking forward to finding out what this new announcement could potentially mean to that project."